Newell Brands cuts prices at Rubbermaid, Pack 'n Play as consumers turn frugal

By Juveria Tabassum and Anuja Bharat Mistry

Feb 6 (Reuters) - Newell Brands NWL.O has cut prices from tariff-fueled highs on baby-care products such as Graco's Pack 'n Play and its Rubbermaid brand, a spokesperson told Reuters on Friday, as the consumer-goods maker tackles weak spending.

Packaged-goods companies' volumes have taken a hit as consumers reduced spending on discretionary categories following multiple price hikes.

Snacks and soda giant PepsiCo PEP.O said on Tuesday it would cut prices on key brands such as Lay's and Cheetos by up to 15%, following feedback from consumers that they were feeling the strain on their budgets.

Newell had lowered prices on products including the Pack 'n Play playard and the Turn2Me car seat under the Graco brand, a Newell spokesperson said.

Prices were being cut at Graco as a result of tariffs being rolled back on China from 30% to 20%, CEO Chris Peterson told Reuters. The Sharpie maker raised prices in three rounds through 2025 to offset the impact from tariffs.

The company pegged its tariff hit this year at $130 million, lower than the $174 million in 2025. Newell has reduced sourcing from China to below 10% in 2025, the spokesperson added.

Newell forecast annual profit below estimates, but its shares clawed back lost ground after company executives highlighted a potential return to sales growth beginning in the second quarter. Its stock was up about 5% in afternoon trading.

"We think this is reasonable, though further category deterioration is a risk given waning consumer sentiment," said Nik Modi, analyst at RBC Capital Markets.

Prices are also being cut at food-storage brand Rubbermaid by up to 15% as Newell invested in domestic manufacturing to increase automation, the spokesperson said.

Multiple price hikes due to tariffs significantly affected consumer behavior and retail dynamics in 2025 as some large retailers shifted from direct import to domestic fulfillment, Peterson said on a post-earnings call.

The pullback in spending was most significant among lower-income and Gen-Z customers aged between 18 and 24 years, and that trend was not expected to improve this year, he added.

Newell's portfolio is heavily exposed to middle- and lower-income consumers who are increasingly wary about spending in the U.S. amid student loan repayments, high food costs and a choppy job market.

The company targets adjusted earnings per share of 54 cents to 60 cents for 2026, compared with estimates of 60 cents, according to data compiled by LSEG.

Fourth-quarter revenue of $1.90 billion edged past estimates of $1.88 billion.