In July 2025, the Board of Directors announced a comprehensive review of strategic alternatives, overseen by a Strategic Review Committee. The objective is to optimize the brand portfolio, improve execution, enhance operating performance, accelerate profitable growth, and unlock inherent value in Kenvue.

The 2024 Multi-Year Restructuring Initiative, approved in May 2024, aims to enhance organizational efficiencies, improve underlying information technology infrastructure, and optimize cost structure. It is expected to incur $550 million in pre-tax charges and realize approximately $350 million in annualized pre-tax gross cost savings starting fiscal year 2026.

The Company began operating out of its new global and North America corporate headquarters in Summit, New Jersey, in March 2025, with a new research and development building expected to be complete by 2026. This move consolidates operations from multiple U.S.-based locations, signaling long-term investment in infrastructure.

Selling, general, and administrative expenses decreased by $137 million (8.3%) for the three months ended June 29, 2025, to $1,504 million, and by $173 million (5.4%) for the six months. This reduction was driven by lower separation-related costs, reduced brand support expenses, and savings from the 'Our Vue Forward' restructuring initiative.

In April 2025, the Company completed its Transition Services Agreement program, successfully exiting more than 2,300 transition services. This marks a significant step in Kenvue's journey to full independence and streamlined operations post-separation from J&J.

The 2024 Multi-Year Restructuring Initiative incurred $60 million in expenses for the three months and $120 million for the six months ended June 29, 2025, an increase from the prior year. While these are current costs, management expects annualized pre-tax gross cost savings of approximately $350 million beginning in fiscal year 2026.

The U.S. government issued executive orders imposing tariffs in the first half of 2025, with retaliatory tariffs from other countries. Kenvue estimates incremental gross tariff exposure of approximately $150 million annualized, which is expected to increase supply chain costs and create economic uncertainty.

The Company faces ongoing legal proceedings related to acetaminophen (Tylenol), Zantac, phenylephrine (PE), benzoyl peroxide (BPO), and talc-containing products. Despite some dismissals and stays, appeals and new filings continue, and the Company is unable to reasonably estimate the likelihood or magnitude of potential liabilities.

The Board's comprehensive review of strategic alternatives, announced in July 2025, may be time-consuming, expensive, distracting to management and employees, and disruptive to business operations. This process could adversely affect business results and lead to increased stock price volatility.

The Skin Health and Beauty segment experienced volume-related decreases of 1.4% (3 months) and 2.1% (6 months) due to a softer sun season, trade inventory fluctuations, market softness in Asia Pacific, and competitive pressures. Baby Care and Oral Care in North America also faced competitive pressures and market deceleration.

Unfavorable value realization of 0.9% (3 months) and 0.6% (6 months) was driven by strategic price investments, particularly in Skin Health and Beauty. This indicates a potential need to adjust pricing strategies to remain competitive, impacting revenue per unit.

Forward-looking statements acknowledge risks including dependence on key retailers and competitive pressure from private-label brands and generic non-branded products. This suggests a challenging market environment where Kenvue must actively defend its market position.

SG&A expenses decreased by $137 million (8.3%) for the three months ended June 29, 2025, and by $173 million (5.4%) for the six months, reaching 39.2% of Net sales (down 180bps). This was driven by lower separation-related costs, reduced brand support, and savings from the 'Our Vue Forward' initiative.

Changes in Cost of sales and gross profit margin were partially offset by gains attributable to the realization of benefits associated with supply chain optimization initiatives. This indicates successful efforts to improve efficiency in the cost of goods sold.

The 2024 Multi-Year Restructuring Initiative includes global workforce reductions, changes in management structure, and the transition to centralized shared-service functions in lower-cost locations. This is a deliberate strategy to optimize the cost structure for future growth, with expected annualized savings of $350 million by fiscal year 2026.

Research and development expenses decreased to $91 million for the three months ended June 29, 2025, from $105 million in the prior year, and to $190 million for the six months from $205 million. This decline occurs even as a new R&D building in Summit, NJ, is under construction, expected to be complete by 2026.

The 'Our Vue Forward' restructuring initiative aims to improve underlying information technology infrastructure and includes significant information technology and project-related costs, accounting for approximately 50% of the total $550 million expected charges. This highlights a focus on digital transformation.

The Company began a multi-year implementation of a new global enterprise resource planning (ERP) system in Q3 2024. This system is designed to replace and enhance existing operating and financial systems, aiming to improve financial information flow, operational functionality, and reporting.

On July 30, 2025, the Board declared a 1.2% increase in the quarterly dividend to $0.2075 per share, payable in August 2025. This follows consistent dividend payments of $0.205 per share in January and April 2025, reflecting management's commitment to returning capital to shareholders.

The Company purchased $127 million of treasury stock during the fiscal six months ended June 29, 2025, under a Board-authorized program to repurchase up to 27 million shares. This program's intent is to offset dilution from the vesting or exercise of equity-based awards, demonstrating a focus on shareholder value.

Total debt remained stable at $8,610 million as of June 29, 2025, compared to $8,607 million at December 29, 2024. This includes the issuance of $750 million in 4.850% Senior Notes due 2032 and the repayment of $750 million in 5.50% Senior Notes due 2025, indicating active debt portfolio management.

The cautionary note on forward-looking statements explicitly lists 'The impact of increasing scrutiny, emerging legal and regulatory requirements, and rapidly evolving expectations from stakeholders regarding environmental, social, and governance matters' as a risk. This indicates awareness of ESG importance but no specific initiatives or progress are detailed in the provided filing.

The Company is a party to various proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act (Superfund) and comparable laws, requiring agreement to implement environmental investigation and remediation activities or reimburse costs at designated hazardous waste sites. This highlights ongoing environmental responsibilities.

While the filing mentions 'environmental, social, and governance matters' as a risk and notes environmental remediation liabilities, it does not provide quantitative data, specific programs, or progress updates on broader ESG initiatives, commitments, or sustainability risks/opportunities beyond legal compliance.

The U.S. government's executive orders imposing tariffs in the first half of 2025, along with retaliatory measures, are expected to increase supply chain costs and create economic uncertainty. Kenvue estimates an incremental gross tariff exposure of approximately $150 million annualized.

Volume-related sales decreases were attributed to a softer allergy and sun season, the continued impact of a weak cough and cold season, and trade inventory fluctuations in certain customers across segments. This indicates sensitivity to seasonal and inventory cycles.

The Company has included the impact of enacted legislation related to the OECD Pillar Two Inclusive Framework in its tax provision since fiscal year 2024. While the current impact is not significant, further administrative guidance or new legislation could materially affect future tax provisions, creating regulatory uncertainty.