Perrigo Company 2Q26 Takeaways: Solid Set of Results After an Otherwise Challenging 2025/2026

Research evidence excerpt

J P M O R G A N

North America Equity Research

05 August 2026

Perrigo Company

2Q26 Takeaways: Solid Set of Results After an

Otherwise Challenging 2025/2026

Overall, PRGO reported a solid set of 2Q results, albeit largely on 1x items, and

while we continue to see significant uncertainty on the broader macro / consumer

environment, trends do appear to be slowing improving. From here, we believe you

need to see continued improvement/execution for the shares to further re-rate

(particularly after the prolonged period of underperformance for the PRGO

business over the past few years). Remain Neutral.

2Q results ahead of expectations although largely on 1x items. Overall,

PRGO’s 2Q results came in ahead of our expectations with sales of ~$1bn (+

$18mm vs JPMe) and EPS of $0.50 (+$0.18 vs JPMe). At the same time, this

appears largely attributable to 1x items including 1) a $10mm tariff reversal

that boosted GM’s by ~90bps, and 2) a ~$6mm Opex benefit related to the CEO

transition, which together resulted in a ~$0.10 EPS benefit by our math.

Additionally, 3) while infant formula came in ahead on the quarter (+$17mm

vs JPMe), this appears attributable to timing of contract manufacturing sales

and will represent a headwind to 3Q results.

PRGO highlighted improving consumer market trends with the company

also gaining share. Here, while consumption remains below historical

averages, trends are sequentially improving. In the US, volumes across the

Specialty & Self-Care categories that PRGO operates in have improved to a

~1% decline YoY in 2Q26 (vs down 1.6% and down 2.1% YoY in 1Q26 / 4Q25)

and turned positive for the four-weeks ending July 19. Additionally, this

softness appears to have been more concentrated in seasonal categories and

PRGO continues to gain share (+50bps in 2Q & an additional +60bps in 3Q).

Similarly, in Europe, trends are showing sequential improvement, although

PRGO did see pressure from continued retailer inventory reductions and soft

seasonal demand in the qtr. From here, we see the improving trends as boding

well for PRGO’s potential earnings recovery 2027+, although we will continue

to watch dynamics going forward.

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