TLDR
- Unilever stock rose over 6% in London after Q2 underlying sales growth of 5.8% beat the 4.3% consensus estimate
- Volume growth of 5.5% was the strongest quarterly performance in over a decade
- Full-year outlook upgraded to 4%-6% underlying sales growth, up from the bottom end of that range
- Home Care led all divisions with 9.1% growth; Foods lagged at just 0.2%
- The planned combination of Unilever’s Foods business with McCormick remains on track for completion by mid-2027
Unilever (ULVR) stock climbed as much as 6.8% to £49.43 in early London trading on Tuesday, hitting its highest level since March 6, after the company posted stronger-than-expected second-quarter results and raised its full-year sales forecast.
The stock was up 5.8% at £48.96 by mid-morning, putting it on course for its best single day in two years. That move comes after the stock had fallen 16% since the Iran war began.
Underlying sales grew 5.8% in Q2, well ahead of the 4.3% analyst consensus. Turnover came in at €13.0 billion, up 3.8%, despite a 2.4% currency headwind.
UNILEVER RAISES OUTLOOK AS VOLUME GROWTH REACHES 16-YEAR HIGH$UL, Underlying sales grew 5.8%, up from 3.1% a year earlier and above company-compiled estimates. The increase was driven primarily by higher volumes, while pricing contributed just 0.2%.
Beauty and wellbeing sales… pic.twitter.com/EqU76Iqary
— Wall St Engine (@wallstengine) July 28, 2026
Volume growth of 5.5% was the standout number. It was the company’s strongest volume quarter in over a decade, powered by markets like India, Indonesia and Latin America.
Unilever now expects full-year underlying sales growth within its 4%-6% multi-year target range, up from its prior guidance of growth at the bottom end of that range. It also raised its volume growth target to around 3%, from at least 2%.
For the second half, the company is guiding for 4%-5% sales growth, led by pricing. It also maintained its outlook for a modest improvement in full-year underlying operating margin from 20% in 2025.
Power Brands Drive the Beat
Unilever’s Power Brands, which make up 78% of total turnover, delivered 6% underlying sales growth in the first half. That group includes names like Axe, Vaseline, Dove and Cif.
Marketing spend stood at 16.1% of turnover in Q2, with a push tied to the FIFA World Cup. CFO Srinivas Phatak told investors on a call: “The days of underinvesting in our businesses are over.”
Home Care was the top-performing division with 9.1% underlying sales growth. Beauty & Wellbeing grew 8.1% and Personal Care added 5.9%.
Foods was the clear weak spot. Sales growth came in at just 0.2%, held back by softer developed markets and rising competition in U.S. condiments. Volumes in the Foods unit actually fell 0.1%.
Foods Sale With McCormick Still on Track
Unilever is in the process of spinning off its Foods business into a combined entity with U.S. spice maker McCormick, valued at around $65 billion. The deal is expected to complete by mid-2027 at the latest.
Barclays analyst Warren Ackerman said the results were “further evidence that Unilever’s home and personal care portfolio can deliver growth well above many global staples peers,” adding that conviction around post-deal growth is increasing.
Morgan Stanley called the results a clear “beat and raise,” noting that volume growth of 5.5% came in more than double expectations. The broker flagged that gross margin came under some pressure from commodity inflation.
Bernstein analyst Callum Elliott said the stronger-than-expected numbers “seem likely to drive a significant uptick in positivity today.”
Finance chief Phatak confirmed the Foods separation is progressing well: “We’re on course to getting this merger finalised.”
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