Kenvue will cut 4% of its global workforce amid investments to grow its key brands, the Tylenol and Band-Aid maker said on Tuesday, as it topped beat Wall Street estimates for first-quarter profit.

Since its spinoff from Johnson & Johnson last year, Kenvue has focused on its 15 priority brands and in February announced it would increase its advertising spending this year.

The company said on Tuesday it targets pre-tax gross savings of about $350 million annually by 2026 through the cost-cutting program, but will incur $275 million each in restructuring expenses in 2024 and 2025.

The consumer health firm had 22,000 employees as of December end, according to its annual report.

Kenvue posted an adjusted profit of 28 cents per share for the first quarter, beating analysts' estimates of 26 cents.

"Given where investor expectations are for (Kenvue), we believe this was a solid overall print and its least noisy since becoming a public company," RBC Capital Markets analyst Nik Modi said in a note.

Kenvue's stock is down 11% so far this year, and 13% from its IPO price since listing in May last year. Shares were up 2.3% in premarket trading on Tuesday.

The self-care segment - which includes cough and cold medicine such as Tylenol and Benadryl - recorded $1.70 billion in net sales, up 3.5% year-on-year and above the average analyst estimate of $1.56 billion, according to LSEG data.

Kenvue's skin health and beauty segment, consisting of brands including Neutrogena and Clean & Clear, recorded a 5% drop in first-quarter net sales to $1.05 billion, but largely in line with estimates.

The company has pushed to improve the presence of its skin health products on store shelves in the U.S. as it looks to reverse sluggish sales over the last few quarters.

The New Jersey-based company posted first-quarter revenue of $3.89 billion, beating estimates of $3.79 billion.

  - Reuters